Two-thirds of businesses say revenue will decline in H1: report

Source:Global Times Published: 2020/3/12 14:23:40

Photo: Xinhua

Two-thirds of Chinese companies estimate revenues will decline in the first half of the year because of the sudden attack of the coronavirus, with nearly half of the estimates falling by over 20 percent, a re-port co-released by DingDang Medicine Express and Huron said on Thursday.

The report, which covered 480 enterprises across the nation, revealed that revenues of 90 percent of enterprises have fallen, and more than a third have fallen by over 50 percent, with an average decline of 40 percent.

The report said a third of the companies had postponed business operation till early March, and 20 percent had postponed work indefinitely. The majority of enterprises whose work has been postponed indefinitely are in the cultural and entertainment, information technology services, manufacturing and education industries.

The main reason for the decline in corporate revenue is shrinking market demand, followed by fixed expenses such as labor and rent.

Accommodation, catering, wholesale and retail, and culture and entertainment sectors are among the most impacted with the steepest decline in revenues. 

Average declines in the manufacturing, real estate and financial industries were 19 percent, 20 percent and 12 percent, the report noted.

Entrepreneurs predict that the overall impact of the epidemic on companies will be temporary. But for 2020, most firms are cautious and 40 percent are somehow pessimistic about the speed of economic revival in the coming weeks and months.

The pandemic has unnerved the nation, as sales in the catering and retail business went down some 50 percent in late January and early February, or put in numbers, equivalent to a loss of 500 billion yuan ($71.69 billion) to 700 billion yuan, according to consulting firm PwC.

China Tourism Academy data showed that in the first quarter of 2020, the number of domestic tourists will decrease by 56 percent year-on-year, and tourism revenue will decrease by 69 percent.



Posted in: ECONOMY

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